2013 n 0004 delray beach beach cleaning final 6-11-2013

7/28/2019 2013 N 0004 Delray Beach Beach Cleaning FINAL 6-11-2013

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OFFICE OF INSPECTOR GENERAL PALM BEACH COUNTY

CONTRACT OVERSIGHT NOTIFICATION

(2013-N-0004)

ISSUE DATE:JUNE 11,2013SIn

Enhancing Public Trust in Government

ITB No. 2013-12 Beach Cleaning, Maintenance and Beautification S

SUMMARY

On February 14, 2013, the Office of Inspector General (OIG) received an complaint concerning the City of Delray Beachs (City) competitive solicitation for Beach Cleaning, Maintenance and Beautification ServicCleaning). According to the complaint, the City awarded the contract to thvendor who was not the lowest bidder.

The OIG found that the City issued a competitive sealed solicitation that wausing a combination of standard Invitation to Bid (ITB) and Request for Proprocesses. As a result, the award which went to the second lowest biddin Questioned Costs of $37,896 and Avoidable Costs of $103,286.

Additionally, the OIG review identified the following concerns with thedocument: (1) bid protest language lacked clarity; (2) contract award faspecificity; (3) evaluation factors did not have weights or points; and, (4) Citto follow Invitation to Bid evaluation instructions.

BACKGROUND

On September 19, 2012, the City issued Invitation to Bid (ITB) No. 2013-1Cleaning services and on October 17, 2012, the following annual bids were recorded: (1) Beach Raker $57,000.00; (2) Universal Beach Servic$94,896.00; and, (3) The Beach Groomer $450,000.00.

On November 19, 2012 the City posted a document titled Recommendatio

recommendation that the Beach Cleaning services contract be awardeRaker, the lowest bidder; however, on this same date the incumbent and sebidder, Universal Beach Service, Corp. (Universal), sent a letter Commission questioning the recommendation. On November 21, 2012, Ua formal protest letter to the Citys Purchasing Officer.

On J anuary 2, 2013, David T. Harden1, city manager, in a letter to Universa


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OFFICE OF INSPECTOR GENERAL 2

contract to Beach Raker, as recommended by the Citys Parks andDepartment.

On J anuary 3, 2013, the City Commission discussed the Beach Cleancontract and the options provided by Mr. Harden. The ITB contained languathe City Commission latitude when awarding the Beach Cleaning contract A Section (1)(a)]. During their discussions, two City Commissioners acthey had conversations with a principal of Universal, while others stated thBeach Rakers bid was too low. Ultimately, the City Commission voted 5-0 Beach Cleaning services contract to Universal.

The OIG notes that the City has established policies that contemplate situavendors submit unreasonably low bids. Specifically, the Purchasing Manstaff to determine if the City needs special protection in the form of a bid performance bond [Attachment A Section (2)(a)(b)(c)]. Furthermore, thethe City additional protection by instituting a probationary period of sixty evaluate vendor performance [Attachment A Section (1)(b)].

FINDINGS

FINDING (1):The Bid Protest language in the solicitation lacks clarity

ITB Solicitation Language:ITB section titled, General Conditions, Instructions, and Informatioparagraph 25, titled Bid Protest, which states, in part: The time for filingfive (5) calendar days from the date bid results become public informatioadded].

OIG Review:On October 17, 2012, the City opened, publically announced and recordedbids for the Beach Cleaning service contract. On November 19, 2012, the Cdocument titled Recommendation notifying the public of its recommendatthe Beach Cleaning services contract. On this same date, the incumbent veletter to the City Commission questioning the recommendation and submitprotest letter, dated November 21, 2012, to the Citys Purchasing Officer.

Because the current ITB protest language lacks clarity, a vendor who eleformal protest could mistakenly believe it had to be submitted within fiveOctober 17, 2012 the date the bids were publically announced; rather days from the City posting its Recommendation document (November 19,

FINDING (2):


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a) Proposed yearly cost to the City of Delray Beachb) Experience, qualifications and past performance of the Contractor,

officers and persons who will be directly involved managing thedescribed in this Request for Proposal Package [emphasis addc) Equipment

OIG Review:The OIG found that the ITB appeared to be a hybrid solicitation, using a of standard ITB (lowest responsive and responsible bidder) and Request (RFP) (evaluation criteria) processes. The ITB contains evaluation criteria twell defined, weighted or ranked as to their relative importance. By inserti

into the ITB that allowed the City to evaluate vague criteria, with no specifiepoints, in addition to price, the award of the Beach Cleaning services confrom being objective to subjective; thus, changing the intended purpose of atypically is awarded to the lowest responsive, responsible bidder.

The use of weights or points assigned to evaluation factors and sub-facselection committees and proposers with a clear understanding of the baward. No formal guidance was provided as to how one criterion was to bvalued, compared to other criteria. Moreover, the ITB did not provide guid

proposers outlining which criteria it considered most valuable. Selection resbeneficial to proposers if they fail to identify scoring for the individual addition, proposers are left to wonder why they did not receive an awardthey compared to other proposers who did. Providing useful feedback thelps to create a larger pool of qualified candidates, which should eeconomic and equitable procurement of services in the future.

Furthermore, the National Association of State Procurement Officials (NASfollowing essential elements when awarding a contract under the compe

bidding

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method: (1) responsibility of the bidder; (2) responsiveness of the the bid with the lowest price [emphasis added]. NASPO continues by difference between the competitive sealed bidding method and the compeproposal3 method as being one where the proposal method permits conbased on a variety of factors, including price [emphasis added].

FINDING (3):

The City did not adhere to steps and processes outlined in the

document

ITB Solicitation Language:ITB section titled, Specifications contains paragraph B, titled Evaluastates, in part: Evaluation of proposals will be conducted by a commStaff [emphasis added] who shall evaluate all responsive applications reapplications meeting or exceeding the contract specifications based


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form of a list of proposed beach cleaning applicants. The City Manager shover his/her recommendations to the City Commission.

OIG Review:Since the ITB refers to establishing a committee to evaluate the proposrequested documentation that the meeting was publically noticed; howevstated such a committee was not convened. Specifically, the Citys Direcand Recreation advised: Ocean Rescue Superintendent and I discussedwhich were submitted and gave our recommendation to Mr. Harden. background research ourselves including checking references. We did committee; therefore there was not a public meeting.

Finally, the Commissions decision to award the Beach Cleaning services cosecond lowest bidder appears to defeat the purposes of having an open coa public procurement. Section 287.001, Florida Statutes, contains the follpolicy statement:

The Legislature recognizes that fair and open competition is a basic public procurement; that such competition reduces the appearanopportunity for favoritism and inspires public confidence that contr

awarded equitably and economically; and that documentation of the acand effective monitoring mechanisms are important means of curbimproprieties and establishing public confidence in the process bcommodities and contractual services are procured.

RECOMMENDATION

Develop and issue solicitation documents consistent with the following elem

1. Protest Language Include specific language describing and posting document as the instrument initiating the start of the protest p

2. Award of Contract Determine the factors, on which contract awbased, with sealed bids contingent on bidder responsibility, responslowest price; and proposals based on evaluative factors inclClearly state the awarding factors and method in the solicitation docu

3. Evaluation Factors Include evaluation factors, and sub-factors,

points.4. When procuring goods and services the City should adhere to its

steps and processes within the solicitation document and ensure stacommittee members follow those steps.

RESPONSE FROM MANAGEMENT


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QUESTIONED / AVOIDABLE COSTS4

Questioned Costs: $37,896

Avoidable Costs: $103,286

ACKNOWLEDGEMENT

The Inspector Generals Contract Oversight staff would like to extend our to the City of Delray Beachs management for the cooperation and courtesito us during the contract oversight process.

This report is available on the OIG website at: http://www.pbcgov.com/Oaddress inquiries regarding this report to Joe Doucette, Chief of [email protected] by telephone at (561)233-2350.
http://www.pbcgov.com/OIGmailto:[email protected]:[email protected]:[email protected]://www.pbcgov.com/OIG


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ATTACHMENT A

Section 1 Invitation to Bid No. 2013-12a. Award of ContractThe City of Delray Beach reserves the right to accept any Bid or combinalternates which, in the Citys judgment will best serve the Citys interest, reall Bids, to waive any and all informalities and/or irregularities, and to negotterms with the Successful Bidder and the right to disregard all non-conforesponsive, unbalanced or conditional Bids. The City reserves the right to all Bids, or any part of any Bid, waive any informality in any Bid, and to

purchase in the best interest of the City. (ITB, page 4)b. Performance Probation PeriodThe successful awardee will immediately enter into a sixty (60) day probatiupon contract award. During this time the awardees performance wiscrutinized by City staff. If the awardees performance fails to consisstandards specified within the bid, his contract will be promptly canceperformance is acceptable, then he will be also notified and the contractthrough the expiration date given in this bid. The City has the right to te

contract during the probationary period with or without cause, and this rsolely at the discretion of the City. (ITB, page 26)

Section 2 - Purchasing Manual5

a. Section XII Bids and ProposalsFormal (sealed) bids and proposals are the most effective procedure competitive prices from vendors in the public (governmental) purchasSubsection (1) (A) Purpose of Bid: Is there a necessity for a special prote

City through bonds and insurance? (Purchasing Manual, page 33)

b. Section XII (1) (F) Bid BondBid bonds protect the City from erroneous or deliberate low bids which theno intention of honoring. Should he fail to enter into a contracts, the forfeited. (Purchasing Manual, page 36)

c. Section XII (1) (F) Performance BondThis bond is a surety instrument guaranteeing that the vendor will perform

the terms of the contract, and is generally in an amount of 100% of the bidaffords protection from non-performance and incompletion of major coeffects of which would result in considerable injury to the City. Shoulddefault, the bond is cashed and the City may then utilize the funds to ccontract with another vendor. (Purchasing Manual, page 36) C


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Attachment B

2013 n 0004 delray beach beach cleaning final 6-11-2013

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